Question: An analyst has estimated how a particular stock's return will vary depending on what will happen to the economy: State of Probability of Stock's Expected

An analyst has estimated how a particular stock's return will vary depending on what will happen to the economy:

State of

Probability of

Stock's Expected Return
the Economy

State Occurring

if this State Occurs
Recession

0.10

-60%
Below Average

0.20

-10

Average

0.40

15
Above Average

0.20

40
Boom

0.10

90

What is the coefficient of variation on the company's stock?

a.

2.121
b.

3.727
c.

2.472
d.

3.334
e.

2.201

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